Item 1.02 Termination of a Material Definitive Agreement.
In connection with the closing of the Transactions (as defined below), on
December 7, 2021, Contango Oil & Gas Company (the "Company" or "Contango")
terminated that certain Credit Agreement, dated September 17, 2019, by and among
the Company, JPMorgan Chase Bank, N.A., as Administrative Agent, and each of
JPMorgan Chase Bank, N.A., Royal Bank of Canada and Cadence Bank, N.A. (as
amended from time to time, the "Credit Agreement"). In connection with the
termination of the Credit Agreement, all outstanding obligations for principal,
interest and fees under the Credit Agreement were paid off in full, and all
liens securing such obligations and guarantees of such obligations and securing
any letter of credit or hedging obligations permitted by the Credit Agreement to
be secured by such liens were released and in connection therewith, all of
Contango's existing commodity hedging agreements were novated to Crescent (as
defined below).
Item 2.01. Completion of Acquisition or Disposition of Assets.
On December 7, 2021 (the "Closing Date"), the Company consummated the
transactions contemplated by the Transaction Agreement, dated as of June 7, 2021
(the "Transaction Agreement"), among the Company, Independence Energy LLC
("Independence"), Crescent Energy Company (f/k/a IE PubCo Inc.) ("Crescent"), IE
OpCo LLC ("OpCo"), IE L Merger Sub LLC ("L Merger Sub") and IE C Merger Sub Inc.
("C Merger Sub"), pursuant to which each of the Company and Independence became
wholly owned subsidiaries of Crescent. Prior to the consummation of the
Transactions, the name of Crescent was changed from "IE PubCo Inc." to "Crescent
Energy Company."
Pursuant to the Transaction Agreement, (i) Independence merged with and into
OpCo, with OpCo surviving (the "Isla Merger"), (ii) immediately following the
Isla Merger, C Merger Sub merged with and into the Company, with the Company
surviving as a direct wholly owned subsidiary of Crescent (the "Merger"), (iii)
immediately following the Merger, the Company merged with and into L Merger Sub,
with L Merger Sub surviving as a direct wholly owned subsidiary of Crescent (the
"LLC Merger" and such entity surviving the LLC Merger, the "Surviving Entity"),
(iv) immediately following the LLC Merger, Crescent contributed (the
"Contribution") 100% of the equity interests in L Merger Sub to OpCo in exchange
for 127,536,463 units representing economic limited liability company interests
in OpCo and (v) immediately following the Contribution, OpCo contributed L
Merger Sub to Independence Energy Finance, LLC (such transactions contemplated
by the Transaction Agreement, the "Transactions").
As of the Merger Effective Time (as defined in the Transaction Agreement), each
eligible share of common stock, par value $0.04 per share, of the Company (the
"Contango Common Stock") issued and outstanding immediately prior to the Merger
Effective Time was automatically converted into the right to receive 0.2000
shares (the "Exchange Ratio") of Class A common stock, par value $0.0001 per
share of Crescent (the "Crescent Common Stock"), with cash paid in lieu of
fractional shares. Additionally, at the Merger Effective Time, each outstanding
award of (i) Company restricted stock vested in full and was converted into the
right to receive unrestricted shares of Crescent Common Stock (together with any
cash to be paid in lieu of fractional shares) equal to the product of (A) the
number of shares of Contango Common Stock subject to such award, and (B) the
Exchange Ratio, reduced by any applicable tax withholding; and (ii) Company
performance stock units, whether vested or unvested, was fully vested and
cancelled in exchange for a number of shares of Crescent Common Stock (together
with any cash to be paid in lieu of fractional shares) equal to the product of
(A) the number of shares of Contango Common Stock subject to such award based on
achievement of the performance criteria set forth in the applicable award
agreement at maximum performance levels, and (B) the Exchange Ratio, reduced by
any applicable tax withholding. Further, immediately prior to the Merger
Effective Time, each award of options to purchase Contango Common Stock that was
out-of-the-money was cancelled in exchange for no consideration, and each award
of options to purchase Contango Common Stock that was in-the-money vested in
full and was deemed net-exercised in exchange for a number of shares of Contango
Common Stock equal to (x) the number of shares of Contango Common Stock subject
to such award, multiplied by (y) the excess of the fair market value of a share
of Contango Common Stock minus the exercise price per share of Contango Common
Stock subject to such award, and then divided by (z) the fair market value of a
share of Contango Common Stock.
As a result of the closing of the Transactions, Independence shareholders
collectively hold approximately 75% of outstanding Crescent Common Stock, and
. . .
Item 3.01 Notice of Delisting or Failure to Satisfy a Continued Listing Rule or
Standard; Transfer of Listing.
In connection with the consummation of the Transactions, on December 7, 2021,
the Company notified the NYSE American that the Transactions had been
consummated and requested that the trading of shares of Contango Common Stock on
the NYSE American be suspended and that the listing of such shares on the NYSE
American be withdrawn. In addition, the Company requested the NYSE American file
with the SEC a notification on Form 25 to report the delisting of Contango
Common Stock from the NYSE American and to deregister shares of Contango Common
Stock under Section 12(b) of the Securities Exchange Act of 1934, as amended
(the "Exchange Act"). The Company's Board of Directors approved the delisting on
June 7, 2021, and authorized the officers of the Company to take all necessary
actions to delist the Contango Common Stock from the NYSE American upon closing
of the Transactions, subject to stockholder approval. The Contango Common Stock
will cease being traded prior to the opening of the market on December 8, 2021,
and will no longer be listed on the NYSE American.
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In addition, the Company intends to file a Form 15 with the SEC to terminate the
registration under the Exchange Act of the Common Stock and suspend the
reporting obligations of Contango under Sections 13(a) and 15(d) of the Exchange
Act.
Item 3.03 Material Modification of Rights of Security Holders.
As a result of the consummation of the Transactions, on December 7, 2021, each
share of Contango Common Stock outstanding immediately prior to the Merger
(other than treasury shares held by the Company, which were cancelled for no
consideration) was converted into the right to receive 0.2000 shares of Crescent
Common Stock, and the rights of the holders of shares of Contango Common Stock
were modified.
The information set forth under Item 2.01, 3.01 and 5.01 of this Current Report
are incorporated herein by reference.
Item 5.01 Changes in Control of Registrant.
Pursuant to the terms of the Transaction Agreement, at the closing of the
Transactions, the Company became an indirectly wholly-owned subsidiary of
Cresent and, accordingly, a change in control of the Company occurred.
The information set forth in Item 2.01, Item 3.01, Item 5.02 and Item 5.03 is
incorporated herein by reference.
Item 5.02 Departure of Directors or Certain Officers; Election of Directors;
Appointment of Certain Officers; Compensatory Arrangements of Certain
Officers.
Departure of Certain Officers and Directors
In accordance with the terms of the Transaction Agreement, as of the Merger
Effective Time, each director of the Company as of immediately prior to the
effectiveness of the Merger ceased his or her respective service as a director
of the Company and all of the incumbent officers of the Company as of
immediately prior to the effectiveness of the Merger, were removed as officers
of the Company.
As of and after the effective time of the LLC Merger (the "LLC Effective Time"),
the sole member of L Merger Sub is Crescent. Following the Contribution
described in Item 2.01 above, Independence Energy Finance, LLC became the sole
member of the Surviving Entity, such member to serve until its successor has
been duly elected or appointed and qualified or until its resignation or removal
in accordance with the organizational documents of the Surviving Entity.
Item 5.03 Amendments to Articles of Incorporation or Bylaws; Change in Fiscal
Year
On the Closing Date, the Company filed with the Secretary of State of the State
of Delaware and the Secretary of State of the State of Texas, as applicable, the
certificates of merger relating to the Merger and the LLC Merger. At the LLC
Effective Time, the certificate of formation of L Merger Sub in effect
immediately prior to the LLC Effective Time became the certificate of formation
of the Surviving Entity (the "Certificate of Formation"). A copy of the
Certificate of Formation is filed as Exhibit 3.1 and is incorporated herein by
reference. In addition, at the LLC Effective Time, L Merger Sub's limited
liability company agreement as in effect immediately prior to the LLC Merger
became the limited liability company agreement of the Surviving Entity.
Item 9.01. Financial Statements and Exhibits.
(d) Exhibits.
Exhibit
No. Description
2.1 Transaction Agreement dated as of June 7, 2021, by and among
Contango Oil & Gas Company, Independence Energy LLC, a Delaware
limited liability company, IE PubCo Inc., a Delaware corporation, IE
OpCo LLC, a Delaware limited liability company, IE C Merger Sub Inc.,
a Texas corporation and IE L Merger Sub LLC, a Delaware limited
liability company (incorporated herein by reference to Exhibit 2.1 to
the Current Report on Form 8-K filed by Contango Oil & Gas Company on
June 8, 2021).
3.1 Certificate of Formation of IE L Merger Sub LLC, dated June 3, 2021.
104 Cover Page Interactive Data File (embedded within the Inline XBRL
document).
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